When you have Medicare Part B, your insurance pays for doctors, outpatient care and medical equipment not covered by Part A. But Medicare Part B doesn’t cover all the costs for this care. There is a deductible and coinsurance that you have to cover. If you have a Medigap policy or Medicare Advantage (Part C), some or all of these deductibles and coinsurance may be covered as part of that policy.
Part B Deductible and Coinsurance
With Medicare Part B, the deductible much less complicated as compared to deductibles for Part A. The deductible for Part B is based on the calendar year, and it is adjusted annually. For 2018, the annual Part B deductible is $183. So you pay the first $183 of applicable, covered, doctor services, outpatient care and medical equipment expenses.
Once your annual deductible is met, you are responsible for the coinsurance payment on your additional costs. The coinsurance for Medicare Part B is 20%. There is no upper limit to the total amount that you’ll pay. That means if you have $50,000 worth of Medicare Part B covered expenses, you’ll be on the hook for $10,000 worth of coinsurance – and Medicare Part B pays the remaining $40,000.
This is 20% of the cost of most doctor services, including doctor services received while you’re an inpatient at a hospital. Outpatient therapy is also included, as is durable medical equipment.
If you’ve had any of these items (or someone you know has), you know that the costs can be astronomical, and can build up quickly. For this reason, it’s important to consider a Medigap policy – which in most cases will cover 100% of your Medicare Part B coinsurance.
Sterling Raskie, MSFS, CFP®, ChFC®
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